Scandals the Norm in Military Buys

Military procurements an uphill battle

By Matthew Little
Epoch Times Staff
Created: February 13, 2013 Last Updated: February 14, 2013
Related articles: Canada » National
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Sikorsky’s CH148 Cyclone helicopter sets down at 12 Wing Shearwater, N.S. Delays and cost overruns have followed continued changes to Canada’s order of Cyclones. (DND Photo)

Sikorsky’s CH148 Cyclone helicopter sets down at 12 Wing Shearwater, N.S. Delays and cost overruns have followed continued changes to Canada’s order of Cyclones. (DND Photo)

PARLIAMENT HILL—Military procurement is an endless scandal that will likely get worse as the government begins a massive buying program and technology pushes warfare into new battlefields.

Accusations of incompetence and misinformation fly as the price tags for jets and helicopters soar, but few acknowledge how complicated military procurements are. In the void left by government silence, cynicism reigns.

Buying cutting edge military hardware, and now software, has been plagued by the same problems for decades. The product is always late, over budget, and beset by glitches.

That trend continues with two recent procurements: Sikorsky’s CH-148 Cyclone helicopter meant to replace Canada’s aging fleet of CH 124 Sea Kings, and the Lockheed Martin F-35 procurement meant to replace the CF-18.

Meanwhile, militaries around the world, including Canada’s, are grappling with a revolution in warfare that makes cyberspace a new battlefield and computer technicians the new Rambos.

The fact that just developing something like a new plane now takes 15 to 20 years instead of 5 increases the challenge.

New hardware like tanks and planes are stuffed with computer code that adds an entirely new layer to their design and construction.

With remote-controlled robots and drones taking to the battlefield, communication supply lines become a new target of attack. Add to this disruptive technologies—like directed-energy weapons and biotechnology—and the complications faced by past procurement programs look downright simple.

If there is one conclusion procurement expert Randall Wakelam has come to after years of study, it is this: “No two procurements are the same but all of them have these wicked problems that somebody has to sort out as best they can.”

Wakelam worked in the air force procurement office in 1988 and 1989 trying to replace land force helicopters. He describes the decades-long effort to replace the Sea Kings as a “tragic comedy.” He literally wrote the book on Cold War fighter jet procurements and is currently a professor at the Royal Military College of Canada.

With military forces increasingly interdependent, no purchase can be made in isolation, Wakelam said. A program he was involved with to purchase radios exemplifies the challenge.

“It seemed like you could just go down to Radio Shack and buy a whole bunch of walkie-talkies, but it’s not nearly so simple.” The purchase took years to complete.

Radios need to work across the army, navy, and air force. Better still if they can connect to international allies. Striving for that drags out the procurement, and soon, new technology is available.

In pursuit of military advantage, defence seeks the new technology, which then impacts other procurements, like helicopters. Delays mount and new tech comes available. Wash, rinse, repeat.

If an order is already made, as in the case of the Cyclone, that means changes on the factory floor, raising costs and delaying delivery. The fact that just developing something like a new plane now takes 15 to 20 years instead of 5 increases the challenge, notes Wakelam.

Chasing Rainbows

While as few as two studies have looked at Canadian procurement, in the U.S., which accounts for nearly half the entire world’s defence spending, procurement is frequently scrutinized.

“Our weapon systems acquisition process is a perpetual scandal,” notes a report by Mark Cancian in a 2010 Defense Acquisition University article.

As in Canada, much of the scandal begins with optimistic companies. Defence officials gladly accept low-balled figures and optimistic timelines because it makes it easier to get governments to approve acquisitions.

But as Cancian notes, “You can’t produce a Ferrari for the price of a Chevrolet, no matter what the salesman said.”

Defence officials gladly accept low-balled figures and optimistic timelines because it makes it easier to get governments to approve acquisitions.

Previous Auditor General Sheila Fraser nailed that point in her review of the Cyclone purchase, blaming defence officials for accepting low-balled figures and then adding on additional options.

Another problem, says Wakelam, is a lack of institutional knowledge. Key staff change departments and the person who bought fighter jets 10 years ago might be buying road building equipment today.

That means each procurement puts new staff through a learning curve already trod by others, increasing delays.

“You can be pretty sure it is not incompetence—it is a desire to be right up there on the leading edge,” Wakelam says.

But some, including the NDP’s military procurement critic Matthew Kellway, think Canada needs to limit its leading edge to existing technology.

“It is clearly a mistake to risk Canadian taxpayer money on developmental projects because you don’t know how they are going to work out at the end of the day,” he says.

You can be pretty sure it is not incompetence—it is a desire to be right up there on the leading edge.

— Procurement expert Randall Wakelam

It’s a point critics of procurements gone awry frequently raise: Rather than squander military budgets on untested tech, buy the best off-the-shelf solution already proven in the battlefield.

That is one of the key recommendations in a report published Monday jointly by the Rideau Institute and Canadian Centre for Policy Alternatives on the Cyclone procurement.

The report takes its title, “The worst procurement in the history of Canada,” from a quote by Minister of Defence Peter Mackay. The two left-leaning think-tanks call for the government to review existing helicopters and play hardball with Sikorsky over the delays.


More importantly, says co-author Michael Byers, the government must be more transparent about military procurements.

The call for transparency has been raised by virtually every critic and report on recent procurements, including two auditor generals, the Parliamentary Budget Officer, several think-tanks, and Wakelam, who says he “violently agrees” transparency must improve.

“I think that is critical,” said Kellway. “At the end of the day it is unclear what is happening behind the curtain.”

That becomes even more the case as the government carries out one of the largest procurement plans in Canadian history, with spending pegged at nearly half a trillion dollars over 20 years.

Kellway says even that figure falls short. “We know that that number is a vast understatement of the full cost of the spending.” He alleges every project is low-balled, pointing to the rising cost of the F-35 as a prime example.

On Wednesday, Kellway blasted Public Works Minister Rona Ambrose for problems with military procurements. Ambrose countered by touting the economic benefits of those purchases. The exchange highlights another factor that complicates military buys: politics and economic benefits.

In an effort to maximize spinoffs from its current military procurements, the government hopes to impose a last-minute strategy on its current spending.

Panel Gives Guidance

To that end, it has requested the help of a panel of experts headed by Tom Jenkins, chair of the Research and Development Policy Review Panel and special adviser to Ambrose.

In a report released Tuesday, the panel notes that with most of the hardware procurements set to be finalized in the next few years, time is of the essence. The government is already taking flack from pundits for not having the strategy in place since the Canada First Defence Strategy, which calls for the purchases, was put in place several years ago.

The panel suggests an interim list of key industrial categories the procurements should aim to support.

The report notes that Canadian defence contractors have fared well, but none would have gotten off the ground—sometimes sparking the growth of dozens of other companies—without a government contract to start them off.

Factoring in those economic benefits further delays procurements. So too do safeguards put in place to ensure the military does not buy the wrong item. Wakelam says one thing he learned during his time in the procurement office was the entire system was geared to avoid getting the wrong gear.

That system includes numerous layers of approvals and reviews, all of which take time.

Meanwhile, the demands on military commanders have increased dramatically. A revolution in military affairs since the Vietnam War has seen casualties become unpalatable, and attrition a matter of revulsion.

Technology is evolving quickly from drones the size of an insect (being worked on by the Defense Advanced Research Projects Agency more commonly known as DARPA) to self-powered robotic exoskeleton being developed by the University of California, Berkeley.

Many advancements are focused on minimizing casualties, a factor complicated as potential adversaries also acquire precision missiles and other advanced military hardware.

Parliament was studying the issue of disruptive technology and the revolution in military affairs as far back as 2000. Meanwhile, some reports suggest hardware is becoming so expensive it will bankrupt the Pentagon.

The Joint Strike Fighter program was largely created in an effort to re-equip Western fleets while avoiding the death spiral fighter jet programs have become prone to: prices escalate, so orders shrink, and the large production runs don’t reach efficiencies of scale. So costs again rise, and orders again decrease. Wash, rinse, repeat.

In short, as the business of war gets more expensive, defence procurements take longer. Delays cause delays and costs rise. While solutions are few and far between, one thing nearly everyone agrees on is that the government needs to better explain defence purchases to the taxpayers on the hook for the final price tag.

Questions on that front sent to National Defence were rerouted to the minister of Public Works before being rerouted to the ministry itself. A public relations officer told The Epoch Times she was looking for someone who could speak to the issue.

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